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Is Retirement Planning the Same as Estate Planning?

Serving Clients in the Gilbert, Arizona Area

Is Retirement Planning the Same as Estate Planning?
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It’s best to create both together when possible so that they can complement each other. Here’s what you need to know.

Retiring can feel like you’ve crossed the finish line. However, it comes with new responsibilities and concerns. There are challenges from inflation to healthcare costs and unintended tax consequences, all of which require careful planning, says the article “Retirement vs. Estate Planning: Do You Really Know How They’re Different?” from yahoo! finance. Estate planning also requires distributing your wealth to the people you want. The best way to accomplish both is to do them together, so they don’t conflict and create problems for you or your heirs.

Let’s clarify retirement planning first. It’s about setting financial goals to build a secure retirement. This requires thinking about your wants and needs—they’re different, too—and how you’ll pay for your lifestyle when retired. It also requires planning for different scenarios in later stages of life, including moving to a retirement community or paying for long-term care and medical treatments.

There are nine primary parts to a retirement plan:

  • Setting goals
  • Estimating expenses
  • Minimizing taxes
  • Identifying income sources
  • Withdrawal strategies
  • Social Security
  • Healthcare costs
  • Reviewing regularly and adjusting as needed.

Next, let’s define estate planning. This is the planning for managing and distributing assets after their death. Its primary goal is to ensure that your wishes are carried out, minimize taxes and provide for the well-being of loved ones. It also addresses planning for incapacity.

The six common elements of estate plans include a variety of legal and financial strategies, as follows:

  • Will
  • Trusts
  • Power of Attorney
  • Advance Directives for Healthcare
  • Beneficiary Designations
  • Ongoing reviews and adjustments

Estate planning and retirement planning are intertwined components of strategies to secure your financial well-being throughout your life and to care for loved ones after your passing. An experienced estate planning attorney will help you understand how to coordinate all elements. Reviewing and revising these plans as circumstances and laws change is essential.

To learn more about estate planning in the East Valley, Gilbert, Mesa and Queen Creek, schedule your free consultation with Attorney Jake Carlson by using one of the links above.

Reference: yahoo! finance (Dec. 19, 2023) “Retirement vs. Estate Planning: Do You Really Know How They’re Different?”